Economic inequality and growth before the industrial revolution: the case of the Low Countries (14th-19th centuries) (original) (raw)
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This paper studies a collection of data on economic inequality in fifteen towns in the Southern and Northern Low Countries from the late Middle Ages until the end of the nineteenth century. By using a single and consistent source type and adopting a uniform methodology, it is possible to study levels of urban economic inequality across time and place comparatively. The results indicate a clear growth in economic inequality in the two centuries prior to the industrial revolution and the onset of sustained economic growth per capita. The general occurrence of this rise throughout regions with dissimilar economic trajectories contradicts the existence of a straightforward trade-off between growth and inequality as conjectured by Simon Kuznets (1955). Instead, the results presented lend support to the ‘classical’ economists’ explanation of inequality as the consequence of a changing functional distribution of income favouring capital over labour in the long run.
Economic inequality in preindustrial times: Europe and beyond
Journal of Economic Literature, 2021
Recent literature has reconstructed estimates of wealth and income inequality for a range of preindustrial, mostly European, societies covering Medieval and early modern times, occasionally reaching back to Antiquity and even prehistory. These estimates have radically improved our knowledge of distributive dynamics in the past. It now seems clear that in the period ca. 1300-1800, inequality of both income and wealth grew almost monotonically almost everywhere in Europe, with the exception of the century-long phase of inequality decline triggered by the Black Death of 1347-52. Regarding the causes of inequality growth, recent literature ruled out economic growth as the main one. Other possible factors include population growth (also as mediated by inheritance systems) and especially regressive fiscal institutions (also as connected to the unequal distribution of political power). The recently proposed theoretical framework of the Inequality Possibility Frontier (IPF) lends a better understanding of the implications of the reconstructed trends. This article concludes by showing how connecting preindustrial trends to modern ones changes our perception of long-term inequality altogether.
Is inequality largely the result of the Industrial Revolution? Or, were pre-industrial incomes as unequal as they are today? For want of sufficient data, these questions have not yet been answered. This paper infers inequality across individuals within each of the 28 pre-industrial societies, for which data were available, using what are known as social tables, stretching from the Roman Empire 14 AD, to Byzantium in 1000, to England in 1688, to Nueva España around 1790, to China in 1880 and to British India in 1947. It applies two new concepts in making those assessments – what we call the inequality possibility frontier and the inequality extraction ratio. The two new concepts compare the observed income inequality to the maximum feasible inequality that, at a given level of income, might have been “extracted” by those in power. The results, especially when contrasted with modern countries, give new insights into the connection between inequality and economic development in the very long run.
Inequality in history: A long-run view
Journal of Economic Surveys, 2024
This article provides an overview of long-term trends in income and wealth inequality, from ca. 1300 until today. It discusses recent acquisitions in terms of inequality measurement, building upon earlier research and systematically connecting preindustrial, industrial, and post-industrial tendencies. It shows that in the last seven centuries or so, inequality of both income and wealth has tended to grow continuously, with two exceptions: the century or so following the Black Death pandemic of 1347-52, and the period from the beginning of World War I until the mid-1970s. It discusses recent encompassing hypotheses about the factors leading to long-run inequality change, highlighting their relative merits and faults, and arguing for the need to pay close attention to the historical context.
Inequality, Development and Economic Correctness
2000
The relation of income distribution to development has been one of the most prominently contested issues in development economics. This is chiefly because it promises to reveal something about the prospects for equitable or “inclusive” economic development, or alternatively about the ineluctable nature of growth/distribution trade-offs. The literature has been characterised by a succession of swings from one “consensus” to another (Kanbur, 1998). Yet, the dominant concern has been till recently to explore the validity and uniformity of some variant of the inverted-U hypothesis. This hypothesis stemming from an interpretation of Kuznets’s (1955) first historical work – held that inequality would rise inevitably in a country as per capita income levels rose, until after some turning-point the distribution of income would just as inevitably start to improve. Despite significant quibbles in some contributions to the literature, the basic idea was quite widely accepted and was deemed by ...
Wealth and Income Inequality in the Long Run of History
Handbook of Cliometrics, 2019
This article provides an overview of current knowledge about economic inequality, of both income and wealth, in the very long run of history focusing on Western Europe and North America. While most of the data provided by recent research cover the period from the late Middle Ages until today, some insights are also possible into even earlier epochs. Based on these recent findings, economic inequality seems to have been growing over centuries, with phases of clear and marked inequality reduction being relatively rare and usually associated with catastrophic events, such as the Black Death during the fifteenth century, or the World Wars in the twentieth. Traditional explanations of long-term inequality growth are found to be unsatisfying and a range of other possible causal factors are explored (demographic, social-economic, and institutional). Placing today’s situation in a very long-run perspective not only leads us to question old assumptions about the future of inequality (think of current criticism of Kuznets’s hypotheses), but also changes how we perceive inequality in the modern world.
Economic inequality in pre-industrial societies: causes and effects, 2020
This paper scrutinizes the insights won by recent studies in wealth inequality in pre-industrial Europe. It focuses on the regions and periods where levels of inequality were relatively low, trying to arrive at an inventory of causes of these exceptions. It discusses catastrophic events, colonization and revolution as possible causes, but argues that these only occasionally had a leveling effect, depending on the social and institutional context in which they occurred. Most clearly wealth accumulation was restricted, even by maximums on ownership, where associative organizations held a solid position, and market and state played lesser roles as coordination systems.
Income distribution and the process of development
European Economic Review, 2000
This paper examines the evolution of the role of income distribution in the process of development. It presents a uni"ed model that encompasses the transition between distinct regimes that have characterized the relationship between income inequality and the process of development. This uni"ed modeling provides an intertemporal reconciliation for con#icting viewpoints about the e!ect of inequality on economic growth } the classical approach which argues that inequality stimulates capital accumulation and economic growth, and the modern approach which suggests, in contrast, that for su$ciently wealthy economies equality stimulates investment in human capital and economic growth.
2020
In recent years, the growth of interest in inequality has produced a wave of new empirical research on income and wealth disparities in pre-industrial Europe.1 The near general consensus emerging from this research has been that inequality tended to rise almost continuously and almost everywhere in Europe from the late middle ages until the 19th century.2 This remarkable result challenges earlier accounts of long-term patterns in inequality such as the Kuznets curve, and has found its way into recent overviews of historical inequality.3 A number of different explanatory factors have been suggested for this growth in inequality – with most recent literature emphasising the importance of regressive redistribution by emerging fiscal states, demographic growth, and proletarianization.4 Although those are valuable explanations for the Europe-wide tendency for inequality to grow, these broad causal factors do not provide a sufficiently detailed model from which to interpret local and regi...
Explorations in Economic History, 1985
Complex policy issues deserve frequent reassessment, and the relationship between economic growth and equality is undeniably complex. Policymakers who care about trade-offs between the two goals continue to press the scientific limits of empirical economics. It takes an enormous sample of long-term national experiences to approximate the data base necessary to move debate from allegation to evidence. Fortunately, the sample continues to expand. Since the 1950s dozens of countries have produced evidence on income distribution and growth, and the records of some currently developed countries have been extended back into the 17th century. This article assesses the empirical harvest. Most of our inferences, however, are based on American and British history. o 198s Academic PWS, IX.